Human Resource Management (MAPMC-602)

Case Study

Human Resource Management Practice of St. Mary University

A Hypothetical Case Study

Reviewer:
Project Management, Section-B,Group 4:
Masresha Zerihun,
Miheret Nugussie,
Nardos Bekele,
Senay Getachew and
Serekalem Wondimu

Submitted to:
Solomon Markos (PhD)

September 5, 2021
Addis Ababa, Ethiopia
 Content

1. Executive summary ...................................................................................................................1

2. Problem Identification and Analysis …………………………………………….……………1

2.1.Poor human resource planning and management …………………………….……………2

2.2.Ineffective Compensation Schemes………...……………………………………………...3

2.3.Poor Performance Appraisal System…………………………………………….…………4

3. Development, Assessment and Evaluation of Alternatives………………………...…………5

4. Recommendations …………………………………………………………….……..…..……8

5. References…………………………………………………………………………..…………9
 1

1. Executive summary
Erskine et al (1998), state cases afford the opportunity to address all seven levels of Bloom‟s
Taxonomy, provided that is the instructor‟s intent. This is a report on the hypothetical case of St.
Mary‟s University‟s human resource management practices. With the use of the Western Ontario
University analytic method to analyze the case human resource management, especially human
resource planning, compensation and performance appraisal problems, are identified and disused
in this report. The employee benefit policy of St Mary University is under scrutiny in this
hypothetical case. Employee benefits policies of an organization are to reduce fatigue, satisfy
employee objectives, reduce turnover (Werther & Davis, 1996).

In this report the group suggested three alternative solutions. These are enhancement of the
capacity and quality of the staff in the human resource management department, the introduction
of a uniform performance appraisal and compensation system as well as a develop and
implement a quality human resource planning and management strategy to solve the identified
problem with justification as well as make a matrix to evaluate and identify the best alternative
followed by a recommendation.

2. Problem Identification and Analysis

The group members tried to read the case at list once to get an understanding as well as to be
able to identify and analyse the human resource management problems presented in the case
individually as stated by Erskine et al [1998], the identification of issues and issue analysis as the
first two steps in preparing a case response. Then the group members meet to discuss the
problems identified and analyzed individually. The group assigned a recording secretary, the one
with greater experience in human resource, to write down the ideas i.e problems and their
analysis that are reached consensus.

The following are the major problems identified in the case of the human resource management
practices by St. Mary University:-
2.1. Poor human resource planning and management
2.2. Ineffective Compensation Schemes
2.3. Poor Performance Appraisal System
 2

2.1.Poor human resource planning and management

The first paragraph of the case clearly indicated the inability of the human resource management
approach used by the university to be inadequate to cope with change and grantee employee
satisfaction.

"Teaching staff have increasingly taken on higher teaching hours as the staff to student ratio has
increased from 1 : 18 to 1 : 28 over the past 12 years. The decrease in staff numbers has been
managed through the non-replacement of leavers and a limited level of early retirement. In
addition to taking on increased teaching loads staff have been exhorted to engage themselves in
commercial work and in research to a much greater extent and to complete PhDs. The pressure
of work seems set to increase and the goodwill and relatively high performance of staff are
increasingly at risk."

The increase in the staff student ratio lead to higher teaching hours plus the decrease in the
number of the staff plus the engagement of the staff in commercial work and research to a much
greater extent caused the goodwill and high performance of the staff to be "increasingly at risk".

Moreover the measure i.e. "the non-replacement of leavers and a limited level of early
retirement" used to manage the above problems indicate poor human resource planning and
management approach. Because human resource planning ensures that the required number of
employees, with the required skills, is available when they are needed (Mondy & Noe, 1990). A
sound human resource plan is expected to give "a summary of this sort gives planners a
comprehensive understanding of the capabilities that are to be found in the organization's
workforce (Werther & Davis, 1996). But what we witnessed in this case is the exact opposite.

Human resource planning, according to Chatterjee (1995), therefore: enables a manager to

predict his/her manpower requirements, to determine the deployment of personnel and to control
wage and salary costs, provides management information about the existing strength and
weaknesses of the people in the organization, assesses the kinds of skills required to be
developed as well as recruited and estimates human resource requirements over a specified time-
frame in relation to the organization's goals.
 3

2.2.Ineffective Compensation Schemes

Why do we need compensation? It is in short, to retain and motivate the existing workforce
toward its goal achievement. As Armstrong (1996) put it, paying for performance is the process
of providing a financial reward to an individual, which is linked directly to his/ her performance.
Now let us compare the compensation system presented in the case with the above compensation
objective.

In the case, St. Mary University decided to put two major schemes into place in relation to staff
performance: first, a staff appraisal scheme and, second, an individual performance-related pay
scheme. Even though standards and guidelines were produced there were great differences in
how schemes were handled in different departments as well as even some department heads were
positively against the system as they saw it as impinging on academic freedom.

The result of the compensation schemes is summarized in the words - "in general staff was
resistant and skeptical". In severe cases, pay dissatisfaction may lower performance, cause
strikes increase grievances, and lead to forms of physical or psychological withdrawal ranging
from absenteeism and turnover to increased visits to the dispensary and poor mental health
(Werther and Davis 1996).

Employees may quit when compensation levels are not competitive, resulting in higher turnover.
Compensation management strives for internal and external equity. Internal equity requires that
pay be related to the relative worth of a job so those similar jobs get similar pay. External equity
means paying employees what comparable employees are paid by other organizations in the
labour market.

Even though some employees were pleased that at last there was potential monetary recognition
for the extra effort they had put in, the system the compensation administers was not uniform,
lacks clarity and transparency and was highly subjective. That is why union representatives
complained about the „shady‟ process in many departments of the University.
 4

2.3.Poor Performance Appraisal System

The need for a carefully planed and transparent appraisal system is a must for an organization to
realize its objectives. The third problem identified by the group is poor performance appraisal
system that lacks a careful planning and transparency. Specially in relation to the individual
performance scheme, what we witnessed is lack of uniformity. Some department made
allocations based on performance appraisal results and others made a separate judgment. And
also others shared the money, in different amounts, between the top three high performers and
one other shared the money out equally between all staff in the department. Most heads of
department allocated the money without any consultation, indeed the heads never got together to
talk about the new system and how to handle it. A small number of heads quickly formed a
senior staff panel to judge the allocation and one head devised a peer assessment panel.

The staff's argument was such payment should relate directly to the performance appraisal results
and to be carried out more thoughtfully. Staff morale was damaged by these events and the
university, which is aware that it mishandled these issues, is anxious to improve matters as
quickly as possible. Our experience as an employee, as many literature and researches proved
that nothing is more demotivating to productive employees than to be paid equal salary as less
productive employees.

In order to realize the purpose of performance appraisal organizations should carefully plan
appraisal systems and follow a sequence of steps including actual performance measurement,
performance and standard comparison, appraisal discussion with the employee, establishing
performance standards as well as communicating standards to the employees. Advocates of
motivation claim that employees are not only be satisfied with basic needs, but other subsequent
needs such as social, ego, and self-actualization are becoming more important (Mondy & Noe,
1990). But this is not done in the University that again resulted dissatisfaction of employees and
unnecessary anxiety on the management of the University.

3. Development, Assessment and Evaluation of Alternatives

The group member shared the notion that the problems identified above i.e poor human resource
planning and management, ineffective compensation schemes and poor performance appraisal
 5

system are the manifestations of poor human resource management practice. Therefore the group
members forwarded the following alternatives in our brainstorming session:

Alternative 1: Enhance the capacity and quality of the staff in the human resource
management department
One group member suggested this alternative i.e. the enhancement of the capacity and quality of
the staff in the human resource management department along with the following justifications:
The human resource staff should be able to acts in an advisory capacity working with other
managers to help them deal with the above human resource management problems. Therefore the
University should work to enhance the capacity of the human resource management staff so as to
minimize the impact of the existing problems and guarantee such problems don‟t occur in the
future or even they occurred to be dealt swiftly in a professional manner.

Alternative 2: Introduce a uniform performance appraisal and compensation system

Two group members come up with the second alternative suggesting an introduction of a
uniform performance appraisal and compensation system. The group members forwarded the
following justifications. St. Mary University should implement a performance appraisal system
that recognize and guarantee the interdependency of effective performance and reward. In order
to realize the purpose of performance appraisal St. Mary University should carefully plan
appraisal systems and follow a sequence of steps that are scientific and proven effective.

Moreover, employee benefits policies of an organization are to reduce fatigue, satisfy employee
objectives, reduce turnover (Werther & Davis, 1996). Therefore, St. Mary University
management should take responsibility and apologize to the staff followed by an introduction of
a uniform and transparent performance appraisal and compensation system. St. Mary University
should introduce a performance appraisal and compensation system that the human resource
specialists, the administrative managers and the teaching staff participated and accepted.

The group members concluded their remarks by coting from the human resource management
course notes: “A rational compensation system helps the organization obtain and retain
 6

employees at a reasonable cost. Without effective compensation management, employees could

be overpaid or underpaid”.

Alternative 3: Develop and implement a quality human resource planning and management
strategy
A third alternative is forwarded by other two members of the group. The proponents of the third
alternative i.e. the development and implementation of a quality human resource planning and
management strategy argued that a quality human resource planning and management includes the
following key element as well as the above alternatives suggested by other group members:
i. St Mary University will be able to cope with the changes and the problems identified in the case.
This is because a human resource plans that is tied with the overall strategy of the University.

ii. Human resource planning and management incorporates human resource inventory that will help
the management to easily identify the gaps in compensation and performance appraisal systems
implemented. Moreover, human resource inventory gives planners a comprehensive
understanding of the capabilities that are to be found in the organization's workforce (Werther &
Davis, 1996).

iii. Human resource plan is the foundation for human resource functions including recruitment,
selection, employee mobility (transfers, promotions, lay-off, etc.) as well as training and
development.

iv. Human resource planning and management endeavours incorporate operational programs. After
the optimal alternative for addressing the organization's human resource issues has been chosen,
it is translated into operational programs with specific plans, target dates, schedules, and resource
commitments (Mondy & Noe, 1990). This is followed by a human resource plan implementation
phase that requires translating the plan into action as well as audit and adjustment phase.

The group members concluded their remarks by siting the statement by Werther and Davis
(1996), that the return on this investment may not justify the expenditure for small firms. Increasingly,
however, large organizations use human resource planning as a means of achieving greater effectiveness.
 7

To make a sound assessment and evaluation of the above suggested alternatives the group
developed the following matrix:-1: Good alternative, 2: Better alternative and 3: Best Alternative
Identified Problems
Suggested
Poor human Ineffective Poor Total Rank
Alternatives
resource Compensation Performance
Or
planning and Schemes Appraisal
solutions
management System
Enhance the capacity of the
human resource department 2 1 2 5 3
staff
Introduce a uniform
performance appraisal and 7 2
compensation system 1 3 3
Develop and implement a
quality human resource 9 1
planning and management 3 3 3
strategy
After much debate the group concluded that the development and implementation of a quality
human resource plan followed by a disciplined implementation of all the steps in the planning
process is the best alternative or solution to the identified problems.

4. Recommendations
Based on the identified problems and their analysis the group forwarded the following
recommendations.
- Compensation system serves as an incentive for employees to do their jobs to the best of their
abilities and efforts. Therefore, St. Mary University must have a reasonable standard against
which performance can be compared.
- St. Mary University management should take responsibility and apologize to the staff
regarding the problems identified and this should be followed by an introduction of a uniform
and transparent performance appraisal and compensation system that is uniform and
transparent.
- The need for a profession human resource management staff is still a must. The human
resource management department is primarily responsible for coordinating the management
of human resources to help the organization achieve its goals.
- In order to realize the purpose of performance appraisal St. Mary University should carefully
plan appraisal systems and follow a sequence of steps that are scientific and proven effective.
 8

5. References
Amabile, T.M., 1996, Creativity in Context. Boulder, Co: Westview Press, Inc.

Baer, J. (1993). Creativity and Divergent Thinking: A Task Specific Approach. Hillsdale, NJ:
Lawrence Earlbaum Associates.

Devanna, M.A. & N. Tichy, 1990, Creating the Competitive Organization of the 21st Century:
The Boundaryless Corporation. Human Resource Management, 29, 445-471.

Erskine, J.A, M.R. Leenders & L.A. Mauffette-Leenders, 1998, Teaching with Cases, University
of Western Ontario, London, ON.

Parkinson, J.M., 1999 Differences in the Assessment of Case Studies, Paper presented at the
16th International Conference on Case Method & Case Application, Caceres, Spain.

Young, J.W. 1974, A Technique for Producing Ideas. Chicago: Crain Books.